As we have now closed on the acquisition of MarkLogic, it is a good time to reflect on why the deal made so much sense. Progress has been executing on a Total Growth Strategy (TGS) for several years to drive inorganic growth, and MarkLogic is a great example of everything we look for in an acquisition candidate, checking the box on every aspect of our financial and strategic criteria.
Our Total Growth Strategy is focused on helping Progress achieve its goal of doubling in size every four to five years, with the current goal of becoming a $1 billion software company by 2025. Aggressive deal sourcing, a focused due diligence process, and a robust integration playbook have all enabled us to so effectively execute this TGS strategy.
When I joined Progress, our revenue was hovering around $380 million. Once we have a full year of MarkLogic revenue under our belt, this will exceed$700 million, representing an increase of 84% in less than four years. While that is an impressive data point, the TGS approach only works if we remain disciplined in our adherence to key corporate development principles. We only pursue acquisition targets that offer: solid scale and a strong recurring revenue model, a sticky product with high customer retention rates, technology that complements our business, a loyal customer base and the ability to leverage our operating model and infrastructure to run the business more efficiently – and MarkLogic represented a compelling target where all these aspects were hit.
These are rigorous requirements so when we come across a company like MarkLogic that “checks all the boxes”, naturally we all come together to make a deal like that happen. We turn over many rocks to find that shiny gem – and MarkLogic is certainly one.
MarkLogic is a leader in complex data and metadata management. Its products provide a unified enterprise-grade semantic data platform that empowers organizations to derive more value from complex data. This functionality complements what Progress currently offers with DataDirect, our cloud and on-premises data connectivity solution.. Together with MarkLogic, Progress can deliver more customer value across the entire data lifecycle, including greater data agility and data insights.
An acquisition only works if it has a sound financial foundation. In the case of MarkLogic, the company ticked off essential boxes, including strong recurring revenue, significant revenue scale and outstanding net and gross customer retention rates stemming from an incredibly loyal customer base. With a passionate workforce committed to the success of its products, MarkLogic presented a prime opportunity to advance Progress’ growth goals. Adding to that, a cultural alignment with our business, we believe this should be a smooth transition as MarkLogic employees become part of Progress, joining our Application and Data Platform business unit.
A quality company like MarkLogic was bound to have multiple suitors, and that was the case. Progress was able to differentiate itself with our ability to move quickly and offer certainty to close. In addition, being well capitalized and agile, means we can close deals at a faster pace than other companies. Speed and certainty to close are traits that positioned Progress as an acquirer of choice for this acquisition.
Looking ahead to 2023, we see a great opportunity for Progress to continue executing on our Total Growth Strategy, and we will continue to drive inorganic growth through accretive acquisitions.
For now, I want to wish a warm welcome to our new colleagues from MarkLogic, and I am looking forward to seeing all the great things we accomplish together.
As Executive Vice President of Corporate Development at Progress, Jeremy Segal is responsible for sourcing, executing and integrating Mergers and Acquisitions, which are essential elements of Progress’ Total Growth Strategy. With a strong track record of successfully acquiring and integrating companies, Jeremy’s expertise and experience better positions Progress to achieve its long-term goal of doubling the size of the company through M&A in five years.
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